A N N U A L R E P O R T 2 0 1 0 – 2 0 1 1 .. Financial Year , in terms of the provisions of section (2) read with section (8)(aa) of. These reserves are estimated annually by the Reserve Estimates Committee of Refineries w.e.f 1st April, have been made in the accounts of At ONGC, We will continue to bring out externally assured sustainability reports through which we will strive to improve our overall engagement with.
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Notes to Financial Statements for the year ended 31st March 1. Its Shares are listed and traded on Stock exchanges in India.
Significant Group Accounting Policies 2. The financial statements are presented in Indian Rupee and all values are rounded to the nearest million except when otherwise indicated. Use of Estimates The preparation of financial statements requires estimates and assumptions which affect the reported amount of assets, liabilities, revenues and expenses of the reporting period.
The difference between the actual results and estimates are recognized in the period in which the results are known or materialized. Government Grants Government Grant related to acquisition of Fixed Assets is treated as deferred income under ‘Deferred Government Grant’ and amount equal to proportionate depreciation of such assets is credited to Statement of profit and loss. Exploration, Development and Production Costs e.
In case of overseas projects, the same is taken to capital work in progress. Such costs are capitalized by transferring to Producing Property when it is ready to commence commercial production.
In case of abandonment, such costs are expensed. Acquisition cost of a producing oil and gas property is capitalized as Producing Property. Nanual case of acquisition cost, Producing Properties is depleted by considering the proved reserves.
These reserves are estimated annually by the Reserve Estimates Committee of the Company, which follows omgc International Reservoir Engineering Procedures. In case, events and circumstances indicate any impairment, recoverable amount of these assets is determined. An impairment loss is recognized, whenever the carrying amount of such assets exceeds the recoverable amount. The recoverable amount is its ‘value in use’ or ‘net selling price’ if determinable whichever is higher.
In assessing value in use, the estimated future cash flows from the use of assets and from its disposal at the end of its useful life are discounted to their present value at appropriate rate. An impairment loss is reversed if there is change in the recoverable amount and such loss either no longer exists or has decreased. Subsequent to impairment, depreciation is provided on the revised carrying value of the assets over the remaining useful life.
Cost relating to dismantling, abandoning and restoring its allied facilities are accounted for in the year in which such costs are incurred repory the salvage value is expected to take care of the abandonment costs.
The abandonment cost on dry well is expensed as exploratory well cost. Investments Long-term investments are valued at cost. Provision is made for any diminution, other than temporary, in the value of such investments.
Current Investments are valued at lower of cost and fair value. Cost of Finished goods is determined on absorption costing method.
ONGC – Annual Reports
Sulphur is valued at net realisable value. The value of inventories includes excise duty, royalty wherever applicable but excludes cess. Provisions are made for obsolete and non moving inventories.
Any difference as of the reporting date between the entitlement quantity minus the quantities sold in respect of crude oil including condensateif positive i. The same is recognized as revenue in the year in which such gas is actually supplied for the quantity supplied onbc in the year in which the obligation to supply such gas ceases, whichever is earlier.
Any retrospective revision in prices is accounted for in the year of such revision. The quantum of work done is measured in proportion of cost incurred to date to the estimated total cost of the contract or based on reports 2011-122 physical work done.
Short lifted quantity of gas b. Gas pipeline transportation charges c. Reimbursable subsidies and grants d. Surplus from Gas Pool Account e. Interest on delayed realization from reporf f.
Depreciation and Amortization p.
Foreign Exchange Transactions q. For practical reasons, the average exchange rate of the relevant month is taken for the transactions of the month in respect of joint venture operations, where actual date of transaction is not xnnual. Notes to Financial Statements for the year ended 31st March Unrealized gains are ignored.
The same is paid to a fund administered through a separate trust. Actuarial Liability in excess of respective plan assets is recognized during the year. Actuarial gains and losses in respect of post employment and other long-term benefits are recognized during the year.
Such expenses relating to Headquarter are charged to statement of profit annuao loss. Insurance claims The company accounts for insurance claims as under: In case insurance claim is less than carrying cost, the difference is charged to statement of profit and loss Account.
Insurance Policy deductibles are expensed in the year the corresponding expenditure is incurred. Research Expenditure Revenue expenses on Research are charged to statement of profit and loss, when incurred.
Deferred Tax Asset is recognized and carried forward only to the extent that there is reasonable certainty that the asset will be realized in future. Borrowing Costs Borrowing Cost specifically identified to the acquisition or construction of qualifying assets is capitalized as part of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use.
All other borrowing costs are charged to statement of profit and loss. Abnormal Rig days’ costs are considered as unallocable and charged to statement of profit and loss. Deferred Revenue Expenditure z. The same is treated as cost in the year in which the gas is actually transported for the quantity transported or in the year in which the right to transport such gas ceases, whichever is earlier.
All other claims and provisions are booked on the merits of each case. Such assets are included as a receivable at an amount equal to the net investment in the lease. The lease payments are bifurcated into repayment and interest components, based on a fixed interest rate and installment as derived from the underlying agreement.
The lease commitments are carried under liabilities exclusive of interest. The interest component is recognised in the statement of profit and loss in accordance with the lease installments.
Lease rentals are charged to the statement of profit and loss on accrual basis. Contingent Assets are neither recognized nor disclosed in the financial statements. Contingent liabilities are disclosed by way of notes to accounts. Other goodwill on consolidation is not amortized. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
ONGC- Sustainability Reports
It is not practicable for the Company to make adjustment for the purposes of applying the equity method. The Company is not a party to the dispute but has agreed to abide by the decision applicable to the operator. The Company had made a provision towards the claim made by the GoI in earlier years and the amount of provision outstanding as on 31st March, is Rs 8, GoI had recovered the above amount [including interest thereon USD In subsequent legal proceedings, The Appellate Authority of the Honourable Malaysian High Court of Kuala Lumpur had set aside the decision of the Malaysian High Court and the earlier decision of arbitral tribunal in favour of operator was restored, reoprt which the GoI has preferred an appeal before the Federal Court of Malaysia.
In view of the perceived uncertainties in obtaining the refund at this stage, the provision made in the books as above has been retained and netted off against the amount recoverable as above in the financial statements for the year ended 31st March, Other Non Current Assets. Generally the details are provided by the operators on monthly basis except in reporh of Sakhalin-1, Russia Project, where the details are provided by the Operator on quarterly basis. Republic of South Sudan is a landlocked country.
Government of Sudan and Government of South Sudan have been negotiating an agreement for the evacuation of crude produced from Republic of South Sudan concessional area through the processing and transportation facilities of Republic of Sudan and have yet to reach an agreement.
In view of the above, currently petroleum operations in the Block have been limited to the maintenance of the facilities to ensure integrity for timely resumption of production operation. Due to the shifting process the operator has not been able to provide the monthly expenditure statement for the month of February and March Hence the expenditure for the month of February and March is booked based on the cash call request 22011-12 those two months amounting to USD 4.
Necessary adjustments would be carried out in the accounts on receipt of the expenditure statement. The amounts paid toward initial payment and signature bonus aggregating to Rs4, He further informed in his letter that based on the opinion of an independent law firm, the restrictions that the Contractor face lead to a Force Majeure FM situation under the Contracts.
Further, once the sanctions have been lifted, the Contractor could then claim its share in production done during the period of the sanctions and pay for the expenditure of those operations if appropriate. Due to the political situation in Syria and the EU 2101-12, this Cash Generating Unit CGUincluding the annnual mentioned assets and receivables was tested for impairment by comparing the carrying value with the recoverable value as on 31st March No impairment provision was required in view of the recoverable value being higher than the carrying value.
The Company has tested all its CGUs for impairment as on Out of this Balance amount of Out of this, an amount of Balance amount reversed is attributable to Jodhpur and Annuaal onshore due to transfer of assets to another CGU and change in estimation of abandonment liability in respect of offshore.
As at31st March, As at31st March, I. Share of Profit – Minority Interest 2, Notes to Financial Statements for the year ended 31st March q.